1.1 Technical Field
The invention generally pertains to methods of investing; and in particular, to investing for retirement or an education concurrently with acquiring a personal residence.
2. Related Art
The acquisition of a home is a foundation of the “American Dream”. Home purchases and the housing construction they stimulate are vital to the U.S. economy. The enjoyment of an adequate, if not prosperous, retirement is another aspect of the American Dream, and the sustenance of the growing population of senior citizens in the U.S. is a responsibility the government is struggling to meet.
Recently, increasing attention has been focused on the steady decline in savings by Americans and their poor state of preparedness for retirement. The economic and social gravity of the looming “Retirement Crisis” is compounded by the impending exhaustion of the Social Security system and the phasing out of pension plans by major corporate employers, especially those that call for employer contributions.
Accompanying these threats to retirement security is the problematic and relentless rise in the cost of a higher education.
Heretofore, funding the purchase of a home and funding retirement (or an education) have been viewed as independent financial goals, wherein the accomplishment of one may occur at the expense of the other, particularly as contributions to retirement from both government and the private sector become unreliable, insufficient, or nonexistent.
2.1 Summary of the Problem in the Prior Art
A problem faced by many Americans is achieving the goal of home ownership without sacrificing a secure retirement (or savings for a higher education); or, contrariwise, funding a secure retirement without sacrificing the benefits of home ownership.
Even for those Americans who can afford to meet both goals, retirement funding is threatened by a widespread loss of the discipline and commitment to consistently set aside savings for retirement throughout a working lifetime.
Financial institutions have been responsive to the needs and opportunities presented in the market for home ownership, on the one hand, and the needs and opportunities in the market for retirement funding, on the other. Competition has grown among financial institutions in both markets.
The advent of the Internet has intensified this competition by making the advantages and disadvantages of products sold in both markets more transparent, as exemplified, for example, by the comparison shopping for home mortgages provided by Lending Tree, LLC; and, for example, by the retirement planning systems and methodologies provided by FMR Corp., Scottrade, Inc., NewRetirement, LLC, and Ameriprise Financial, Inc., to name but a few.
Significantly, resources which provide information about mortgages and resources which provide information retirement planning refer to combining the two financial products. Indeed, a reverse mortgage—little more than a home equity loan for senior citizens—appears to be the only financial product to offer retirement income in the setting of existing home ownership, regrettably supplementing the former by devaluing the latter. The prevailing financial paradigm in the U.S. has consigned mortgage financing and retirement financing to distinct lines of commerce, each of which ignores the low rate of personal savings endemic in the U.S.
The present invention is responsive to the foregoing problem by providing loan providers and borrowers with systematic methods that promote the acceptance of loans secured by a mortgage and concurrently encourage borrowers to save and invest for retirement or a higher education.